National Grid today asked NY regulators to approve new electric and gas rates in its Upstate service territory, which extends from Albany to Buffalo.

(David Lassman)

SYRACUSE, N.Y. -- National Grid today asked state regulators to increase its delivery rates by $326 million a year for electricity and $81 million for natural gas. The rate hikes could have a "significant'' impact on customer bills, company officials said.

The increase translates into a potential bill impact of $11 a month (14 percent) for residential electric customers, and $10.50 a month (15 percent) for gas customers, according to company filings. National Grid proposes to soften the impact somewhat by spreading it over three years, which would still result in 10 percent hikes for the average household, said Ken Daly, president of New York operations.

A 10 percent bill increase would raise the cost of heat and lights by $180 a year or more for a typical household, according to the utility's data filed today.

If the state Public Service Commission approves the new rates, they would take effect in April 2018.

According to the rate hike request, National Grid plans to hire 280 new employees in the Upstate service territory, which extends from Albany to Buffalo. The new jobs would include a variety of positions, including engineers, field technicians, regional control operators, line and gas mechanics, relay testers, supervisors, mapping technicians and back office support staff.

The company also said the higher rates will enable it to invest more than $2.7 billion in its electric and gas networks.

The rate request comes as increasing numbers of National Grid customers are struggling to pay the bills. The utility shut off more than 66,000 customers for nonpayment in both 2015 and 2016, the highest rate of terminations in at least a decade.

The utility has asked the PSC to allow it a 9.79 percent return on equity, or profit rate, before sharing profits with ratepayers. That's higher than the current 9 percent rate set in 2016.

The $326 million of additional electric revenue requested by National Grid represents a 23 percent increase compared with current delivery revenues. The proposed $81 million gas hike would be an increase of 24 percent for gas delivery revenues, according to company filings.

PSC officials said National Grid's request will be subject to a rigorous review and public hearings over the next 11 months. "At the end of the review process, the PSC will have the final say in determining what the rates will actually be,'' spokesman James Denn.

National Grid's Upstate delivery rates were last set in 2013. National Grid's proposal, in 2012, asked for $145.4 million in higher electric revenues and $29 million in gas revenues. The PSC decided the case in 2013, authorizing an increase of $43.4 million for electric and a decrease of $3.3 million for gas.

In 2016, the utility struck a deal with regulators to keep the rates frozen through 2018. As part of that deal, the PSC agreed to let National Grid spend $152 million that had been held for future rate decreases rather than use it to lower rates.

National Grid's delivery charges, which change only after approval by state regulators, represent about half the bill for a typical residential customer. The other half is the supply charge, which can vary monthly.

When gas and electric supply charges are low, as they have been in recent months, delivery charges can account for the majority of the bill. All customers pay for delivery, even if they take supply from an energy service company.

National Grid delivers energy to about 1.6 million electric customers and 600,000 natural gas customers in Upstate New York.